In response to the request on potential liability to the sexual harassment case brought by Virginia Pollard, the company is vicariously liable for the conduct of its employees even though there is a sexual harassment policy in place. Virginia had become a victim of a hostile work environment supported by a supervisor with immediate authority over the employee. Pollard was working in a very stressful environment in which she (being the only female) was a minority being subjected to inappropriate language and other unwanted and uninvited behavior. Pollard was humiliated on a daily basis (i.e. pranks involving taping her drawers shut, locking her out of the guard shack, having a forklift backing up to the guard shack and backfiring into her ear) and also upset with the lack of support from her manager.
In one incident Mr. King and the other warehouse workers put a sign on a truck that read "HARDHAT REQUIRED/BRA OPTIONAL." King and another employee called Pollard over to look at the sign and encouraged her to do as it said. This clearly indicates that Mr. King had knowledge of the harassment. Mr. King’s conduct was sufficiently serious to alter the conditions of Ms. Pollard’s employment and constitute an abusive working environment. Teddy’s Supplies can be held liable for the harassment of its supervisory employees because the harassment was pervasive enough to support an inference that the employer had "knowledge, or constructive knowledge" of it; under traditional agency principles Mr. King and the other male workers were acting as the agents for Teddy’s Supplies when they committed the harassing acts.
Two recent Supreme Court cases have set forth a new test for determining when an employer is vicariously liable for a hostile work environment created by a supervisor. In Burlington Industries v. Ellerth, and Faragher v. Boca Raton, the Supreme Court held that “[a]n employer is subject to vicarious liability to a victimized employee for an actionable hostile